SACRAMENTO, CA – Advocates of eminent domain tout it as a tool to eliminate blight. Government use of eminent domain, however, actually creates blight, according to a recent investigative report by the Orange County Register.

"Highway  Robbery: How the California Department of Transportation took land it didn't need and became one of the state's biggest slumlords," published on October 15, reveals that the California Department of Transportation (Caltrans) still owns hundreds of vacant homes seized through eminent domain decades ago. These homes were to be bulldozed to make room for highway projects, but many of those plans were scrapped in the late 1970s and '80s. The Register found that Caltrans has neglected these properties for years, leaving them to deteriorate into hideouts for vagrants and drug addicts.

During the 1950s, '60s, and early '70s, Caltrans used its eminent domain power to purchase thousands of homes from owners throughout the state who lived in the path of proposed highways. While Caltrans planned on constructing close to 70,000 miles of highway in California, budget constraints, local court battles, bureaucratic red tape, and stiff environmental laws reduced the number of miles to just 45,000. The cancellation of so many highway projects left Caltrans with hundreds of vacant homes. Instead of returning these properties to their original owners, the department chose to keep them.

Some were turned into rental units with Caltrans acting as landlord. Not surprisingly, Caltrans has done a poor job maintaining these rentals. The Register reports that "40 percent of the homes Caltrans owned and rented out in the past decade had faulty plumbing, 20 percent had leaky roofs, and six percent had rodent infestations."

Tenants, aided by non-profit groups and local city attorneys, sued Caltrans citing violations of local slumlord laws. The court ruled that Caltrans, a state agency, is exempt from any local ordinances. In response to the Register article, Caltrans director Will Kempton admitted that Caltrans shouldn't be in the rental-management business.

"We have to recognize that this isn't something we are particularly good at," he said. Caltrans hasn't fared much better in its care of non-rental properties.

Caltrans only rents out 26 percent of the units it owns. The rest remain vacant, boarded up, in disrepair, and in many instances forgotten by Caltrans—perfect places for criminals and squatters. Some of these homes have remained in shabby conditions for more than thirty years—constant reminders to neighbors why their property values aren't as high as they could be. Worse, though, is the impact on the former owners, who were led to believe they were helping the greater good by selling to the government.

"They made it sound urgent, like they were going to start construction any day," recalled Sidney Stone, a retired pastor from Hayward who had to sell his home in 1970 for $36,000. He now estimates its potential worth as being close to $800,000. Stone wishes he could afford to buy it back, but even if he could his request would be in vain: Caltrans won't sell.

Fortunately, future victims of Caltrans' eminent domain miscalculations may be able to repurchase their homes if future highways fail to materialize - that is if voters approve Proposition 90 on November 7.

Under Proposition 90, eminent domain can only be used by government agencies for specifically stated public uses, not, as in the Kelo case, to transfer property to other businesses in the quest for more tax revenue. Once a specifically stated public use is rejected, then the agency would be required to allow the original property owner—or a beneficiary or heir of that owner—to reacquire the property at the current market price. If Proposition 90 had been in place when Mr. Stone was forced to sell, he would have been permitted to buy the property back from Caltrans nearly 20 years ago when the highway project was officially nixed. Instead, Stone's home sits empty and continues to decay.

The revelation of Caltrans mismanagement should give Californians another reason to support eminent domain reforms. Fortunately voters have the opportunity to control government-created blight with the approval of Proposition 90.

Anthony P. Archie is a Public Policy Fellow in Business and Economic Studies at the Pacific Research Institute. He can be reached via email at aarchie@pacificresearch.org.